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This year the EUROS begin again in June, hosted in Germany and set to increase spending across the UK again.

In 2022 the UK viewers of the Euros reached 17.4m and globally there were over 300 million viewers.

 

Where do people spend the most money?

Pubs and restaurants are welcome hosts to fans across the country who are more willing to spend around the time of the sporting event.

Lloyds Bank data found that in 2020, the year England were in the finals, spending in pubs and restaurants increased by 52%.

As well as this, spending in supermarkets increased by 26% in the time between June and July that year.

 

The economic impact

In 2022 during the UEFA Women’s Euro spending was at a high as well with an £81m economic impact for host cities across the Country.

They found that there was £44m in spectator spending around matchdays as well as trips to host cities.

Domestic and international visitors made over 552,000 day and over night trips to these cities.

Sporting events have been proven to lift the spirits of the public and in effect increase their spending which boost business and therefore the economy.

The economic impact is always greater for the host country which is why the bid for this is intense and begins early. England, Northern Ireland, Wales, Scotland, the Republic of Ireland and Turkey are already bidding for the host role for 2028 reported from Sky News.

 

Is this a short-term boost?

While businesses definitely prosper from large sporting events and increased spending this effect does usually die down. Once the celebrations disappear the spending slows and could even decrease.

If the public have overspent during the event then they may have the next few months of cutting back which leads to inconsistent spending.

Personal Finance Impact of a Labour Government.

It’s highly likely to be election year this year and if the polls are accurate then Labour are in the driving seat to form its first government for 14 years with Sir Keri Starmer as prime minister, which could mean some significant changes for your investments and pensions.

The latest YouGov/Times voting intention poll placed |Labour on 44%, with the Conservatives  lagging behind by some distance with just 19% of those asked saying they would vote for them.

This is the same share of the poll they received following the aftermath of Liz Truss’ disastrous mini-budget two years ago.

Labour’s simplifying ISAs plan

Earlier this year Labour released a report Financing Growth: Labour’s plan for financial services, which outlined its plans for how your personal finances would be handled if it won power.

The savings landscape is to be reviewed, and a major part of the plan to reinvigorate the capital markets is to simplify ISAs to make it easier for people to feel the benefits of saving.

This is to be done through the increased utilisation of stocks and shares ISAs.

Although the report does not offer any more details of how this would happen.

It’s a direction that would welcomed by some major players in the financial services market such as AJ Bell, who have long advocated ISA simplification moving away from the multiple products of today’s system to a single ISA vehicle.

 

Pensions to be reviewed

Labour welcomed auto-enrolment for pensions that was introduced by the coalition government in 2012, and it will re-evaluate the whole pension model to review whether the current framework delivers sustainable retirement incomes.

A future Labour government would work with industry and consumer groups to ensure that savers are getting the best returns.

Also to identify and tackle the barriers to pension schemes investing more into UK productive assets, for example cultural and regulation-induced risk aversion.

All types of pensions will be assessed, including the employer-sponsored defined benefit schemes, where the amount is based on how many years you have been a member of your employer’s scheme, which is more typical in the public sector.

For Local Government Pensions Schemes, Labour will look to gauge the different models for asset pooling in pensions.

This includes in-house fund management at the pool level, with the aim to deliver higher returns for savers and to increase investment into more productive assets.

Also personally subsidised defined contribution schemes are to be reviewed, where Labour will hand The Pensions Regulator (TPR) new powers for consolidation if schemes fall short of offering sufficient value to its members.

The TPR will also be asked to provide guidance on fund and strategy suitability over your pension pots, and the minimum thresholds for scheme performance will be kept under review by a Labour government.

Labour also plan to bring in an opt -in scheme for your defined contribution pensions, where a proportion of its assets can be directed into UK growth assets that can be split to areas such as venture capital, small cap stocks and infrastructure investment.

A committee would be set up comprising of private investors who will draw up a list of venture and small cap funds that are supported by British Patent Capital, which is the largest domestic investor in British venture growth opportunities.

The next stage is that institutional investors will be asked to allocate a small proportion of their funds and your money to the opt-in  scheme.

 Consumer protection to be strengthened

Labour will empower payment service providers to delay any payments that they believe to be suspicious, this would support the work in this area which is already being carried out by the Financial Conduct Authority (FCA) and the Payment Systems Regulator.

The buy now pay later market (BNPL) is growing doe to the cost of living crises, and Labour aim to increase regulation over BNPL, something which providers have been calling out for.

The report said that Labour has laid out a plan for regulation to shield unprotected consumers, having spoken to influencers in the sector which it said has received broad support, but the details of the plan were not revealed.

The advice gap also needs to be closed and Labour said that it supports the ongoing work in this area of the FCA, such as addressing the advice gap through the Advice Guidance Boundary Review.

A Labour administration will closely monitor the progress in closing the gap, as its  report said that only 8% of UK adults have received expert financial advice.

 

 

 

 

 

 

If you are already receiving your pension or you are keen to keep on track of your pension plan options then you might be wondering what the triple lock system means.

Triple lock pension

This is the system which maintains the rising pension payments so they stay in line with the rise of inflation and cost of living. The triple lock pension ensures that the state pension pot rises with the average earnings growth, inflation or 2.5%, whichever one is highest.

This systems allows pensioners who are relying on the state pension to be able to afford rising prices without worrying.

The BBC reports that Jeremy Hunt has promised that the triple lock system will remain apart of the conservative manifesto if they win the next election.

This promise is no surprise as pensioners are a large portion of the conservative voting demographic.

The state pension cost £110.5bn in 2022-23 which is just under half of the total government spending's on benefits.

The Office for Budget Responsibility estimates this will grow to £124bn this year.

 

How does this affect me?

If you are currently receiving state pension or are going to start in the near future you can feel secure knowing you state pension allowance will continue to rise in line with the cost of living prices.

This also mean that the cost of paying for these benefits is going to increase each year as more people reach retirement age than the young working population.

So you have found your dream property and have had your offer accepted, now you are ready to handle the nitty gritty mortgage details.

You will have to find the best mortgage deal that works for you and then you can apply online or over the phone. You may choose to go with a broker to help you get the best deals.

Do you need a mortgage broker?

A broker is a qualified and regulated mortgage advisor. They should remain unbiased and be there to help you wade through all the offers and find you the best deal for your situation.

Having a broker will save you time and effort trying to find the best deal, they will also be able to handle the negotiations with the lender for you. A broker will help you understand the mortgage rates and know what you will need.

Make sure to be upfront with the broker about your finances and credit so they can do their job properly.

You either pay them a broker fee which is usually around £500-1000 or they will receive a procuration fee from the lender, which won’t affect your total.

If you are confident you can find the best deals yourself then you can skip this step and move on.

What you need for your application

You will need original copies of all the forms listed below, make sure you have these ready before starting the process, this will help you speed things up.

A mortgage in principle

This is a conditional offer from a lender with no guarantees this will go through to completion. This helps buyers to have a sense of confidence during the process whilst the lender continues with their checks

The lender will complete credit checks, these could damage your score so make sure not to have too many in short space of time.

‘Soft’ credit checks leave a less visible sign to the next lender so check which type they are using.

Don’t rely on your existing bank or building society as this vastly limits your options and cuts the market short.

Fees

On top of all the big payments you’re making to buy a house it is important to factor in all the other fees you have to think about too.

Arrangement fee

You will pay this to the lender and it can go up to around £2000 which you can pay upfront or add on to the price of your mortgage. If you pay upfront be aware that this is a non-refundable sum even if your offer falls through.

Booking/reservation fee

Some lenders will charge this fee to secure a fixed-rate, tracker or discount deal. This will be around £100-200 and is again non-refundable which you can pay upfront. Sometimes this will be rolled into the arrangement fee and won’t be a separate charge.

Valuation fee

The lender will carry out checks on your chosen property to determine the value in case you miss payments and the property is repossessed. The cost of this will depend on the property value. You can also ask for a survey at an extra cost which will check for any hidden damages and structural problems which is especially important if you are buying an old house.

Legal fees

This is paid to your solicitor and covers all the legal work needed when buying a house including, conveyancing which searches local authorities data for hidden damage on the property. This will cost roughly £500-1500.

Stamp duty

This is a tax paid to the government which some developers will offer to pay if you are buying a brand new home.

The price depends on the property value.

If the property price is between £300,001 to £925,000 then you will pay 5% in stamp duty.

 

The application process in total can take months to reach completion which is why before you start, it can be helpful to make sure you have all the information, are sure you can cover all costs and have all the correct documents.

Happy Mortgage hunting!

The Office for National Statistics released their unemployment report for the quarter containing December 2023 to February 2024.

Unemployment

 The Unemployment rate has risen to 3.9% whereas last quarter it was at 3.5% leaving many people without a job and a source of income.

The amount of job vacancies and advertising is decreasing by 4.5%, as the number of vacancies in December 2023 to February 2024 was 908,000, a decrease of 43,000 from September to November 2023.

The industry with the most dramatic fall in vacancies was human health and social workers sectors.

Redundancy

People reporting, they left a job due to redundancy has increased by 2.5 per thousand employees.

Number of hours worked

The number of working hours has increased since lockdown measures were relaxed in the UK. However, they are still lower than pre-pandemic levels. From November 2023 to January 2024 there was an average of 1.06 billion hours works across the UK.

Pay levels

In 2024 UK employers should receive a pay rise of 4.4% which should boost the economy and boost morale within workplaces.

The average weekly earnings were estimated at £666 for total earnings and £623 for regular earnings in November 2023. This has been a steady increase over time.

They have also revealed that the monthly update on wage growth, the increase in average employee wages including bonuses was at 5.6% November 2023- January 2024. This shows wages are growing higher than the rate of inflation which is currently at 4%

Annual inflation is slowly falling meaning pay levels can ease.

Forbes reported that there are roughly 3 million workers on the National Living Wage of £10.42 which is set to rise in April 2024.

Why unemployment rates are rising

The Office of National Statistics (ONS) states that the high unemployment rates are due to employers cutting back on hiring new staff. They have stuck to internal staff cutting down the number of vacancies.

They argue that employers are waiting until the economy picks up before hiring new talent as they believe it would be difficult to recruit.

As well as this the cost-of-living crisis is making it difficult to afford to hire new staff.

The ONS have also found a high number of people reporting long term illness deeming them unable to work full time.

 

Budgeting can be difficult to set up and stick to especially if your monthly income is small. If you are trying to save, have noticed the rising prices or just need to cut down to decrease your monthly outgoings then these tips could help you to budget.

If you are trying to save, learn more about finances or want to take on some new techniques for your money then reading from those who have done it or are experts in the field could help you.

There is so much advise out there it can become overwhelming, when finding the book for you make sure it contains what you are looking for and won’t make it more complicated than necessary.

Below is a short list of books which could help you to invest, save, learn about finances and help you build better habits. Pick up one of these helpful reads for world book day and learn more about your finances.

The Spring Budget is here! The Chancellor of the Exchequer Jeremy Hunt has outlined the Spring Budget and the highlights are outlined here.

Introduction

Mr Hunt started by addressing the "tragic loss of life in Israel and Gaza". And announces a £1 million memorial to be created in honour of fallen Muslims who died in both World Wars.

He highlighted the economic difficulties of the last 16 years from the 2008 financial market crashes.

Inflation

He notes the efforts they've made over the last 2-3 years will lead to more growth, more jobs and higher wages. And after some jibes attacking Labour's economic plans he follows up with the OBRs reporting that inflation which was at 11%, it is now at 4%. Today's forecast suggests that inflation will fall under 2% earlier than expected within the next few months.

Cost of Living Support

The Household Support Fund will be extended beyond 31 March and continue for 6 months.

In Autumn he froze alcohol duty until August 2024. He has now extended the alcohol duty freeze to Feb 2025.

The Fuel Duty cut has been maintained and frozen for another 6 months.

He also noted that one of the focuses today is on those falling into debt. He therefore has increased the repayment period for loans to cover household emergencies from 12 months to 24 months and an end to £90 charges for debt relief orders.

Debt & Deficit

Hunt then noted that there is no growth without solid finances. Highlights cutting deficit over last 14 years "by 80% between 2010 and 2019", amounting to £370bn they could then provide during the Covid-19 pandemic.

He says that the focus should be on reducing debt instead of borrowing. OBR announces debt will fall over the next 5 years. He says that today's forecasts show debt will fall to below to 94% by 2028 and 2029, down from over 100%.

He says that UK continues to have the lowest national debt in the G7, lower than Japan, France and the United States.

Turning to growth he notes that the OBR expects the economy to grow by 0.8% this year and 1.9% next year which is 0.5% higher than their autumn forecast. He adds that this is forecasted to continue at this level until 2027.

British ISA

He then announces the creation of a “British” ISA in the form of an extra £5,000 tax-free allowance for the public to invest exclusively in the UK.

Regional Investment

He then announces a large regional investment package in the North West a "North-East trailblazer devolution deal", a package worth over £100m.

He then announces further regional funding , and announces that he has allocated £188mfor projects in Sheffield, Blackpool and Liverpool. as well as £242min Barking Riverside and Canary Wharf.

VAT & Business investment

Hunt also increases the threshold for VAT registration will go up from £85,000 to £90,000.

Now moving to business investment he notes that "Business investment has risen from an average of 9.3% of GDP under Labour to 9.9% under the Conservatives. This year it will be 10.6% of GDP – generating £30bn more in business investment than if it had continued at Labour levels. And it is still going up," he says.

Energy

The secretary for energy security and net zero is investing up to £120m more to the Green Industries Growth Accelerator,

This is to build supply chains for new technology such as offshore wind and carbon capture.

Hunt also announces £270 million for advanced manufacturing industries, to fund car and space innovation.

Creative Industries

The chancellor confirms the Autumn Statement announcement that the rate of tax credit available to the industry will rise by 5% and an 80% cap for visual effects costs will be removed.

Hunt ensures that the tax reliefs just mentioned will become "permanent at 45% for touring and orchestral productions". For non-touring productions that relief will be one of 40%.

Medical Research, Healthcare & NHS

Hunt turns his attention to medical research. He is proposing an additional £45m investment with £3m put into cancer research.

He announces a brand new investment in to life sciences company AstraZeneca.

Hunt also announces an additional 650m investment in the Cambridge Biomedical Campus and a new vaccine manufacturing hub in Liverpool.

Childcare Plan

Hunt discusses the government's plans to address working vacancies and how to fill these gaps, using this to discuss their childcare plan. Previously, it was expanded to 30-hour a week of free childcare.

He announces a guarantee on the rates that will be paid to childcare providers to deliver the government's landmark offer for children over nine months old for the next two years.

Public Sector Productivity Plan

The investment needed to modernise NHS IT systems will cost £3.4bn - but will unlock £35bn of savings.

"And as a result of this funding, all hospitals will use electronic patient records, making the NHS the largest digitally integrated healthcare system in the world," he adds.

Smoking & Vaping Duties

Hunt has introduced a new levy on vaping.

There will also be a one-off increase in tobacco duty.

Air Passenger Duty

The government is increasing the Air Passenger Duty (APD) for business class travellers, Hunt announces.

Housing Tax Reforms

The chancellor says he will scrap tax breaks which make it more profitable for second homeowners to let out their properties to holiday makers as opposed to long-term tenants.

Hunt then announced that stamp duty relief for people buying more than one dwelling is being scrapped as the system was being taken advantage of.

Capital Gains Tax Cut

The higher rate of property capital gains tax is to be reduced from 28% to 24%, Hunt announces. He says the move is predicted to increase revenues as there will be more transactions.

Non-Dom Tax Reform

The government will abolish the current tax system for wealthy foreign residents in the UK who have non-domiciled tax status. By reforming this Mr Hunt says it will make the system "fairer and competitive". It will be replaced with a "modern residency system".

It will raise £2.1 billion with which the Conservatives will use to cut taxes.

Child Benefit Reform

Hunt says he will be reviewing the potential for a new rule on collective household income, rather than on an individual basis, which he aims to introduce by April 2026.

To help in the short-term, he will increase the threshold from £50,000 to £60,000.

And the top of the taper at which it is withdrawn will go up to £80,000.

Half a million families will save money as a result of this.

National Insurance Tax Cut

The chancellor announces a fresh cut to National Insurance contributions for employees from 6 April.

Hunt says he will reduce the rate by a further 2p, worth around £450 a year for someone on an average salary.

 

House prices are falling and many believe they will continue on this path through 2024.

This sounds like good news, however for those selling their properties, this means they are having to reduce their asking price. Also, with high and rising mortgage rates, many people still can’t afford to buy.

Predictions for the Property market 2024

Despite house prices falling they are still far above the rates of pre-pandemic house prices due to inflation and high mortgage rates. People can no longer afford to borrow the money necessary to buy a house meaning fewer houses are being bought. Even if people have saved for a deposit paying back the mortgage loan creates a heavy financial burden.

The Bank of England has held the base rate at 5.25% and as a result the average mortgage rates have shot up.

Why have House Prices fallen?

With mortgage rates rising, less people are able to afford to take out the loan, pay the deposit and it is harder to prove you can afford the high rates.

This means buyer demand has decreased across the property market forcing those selling property to keep the prices low.

Where have prices fallen the most?

Zoopla has found that areas in Essex, Kent, Norfolk and Suffolk have seen the greatest price decreases.

Colchester in Essex has seen a 3.7% decrease with the average house price at £303,500.

Even in popular cities house prices are slowly falling such as, Manchester, Liverpool and Edinburgh.

Rightmove found that houses in Greater Manchester have an overall average price of £253,806 with most sales being for semi-detached houses with a 1% fall in average prices in this area.

Property Investors hunting for deals

The Financial times reports that commercial property investors are on the prowl for cheap deals as rising interest rates force many to sell their property in an inability to refinance. Many are having to sell this year and are forced to keep the asking prices low to match the demand, this means investors could very well find a great deal this year.

When Mortgage rates begin to decline, the hope is that more buyers will flock to the property market as more people will be able to afford the loans.

Should you buy now?

Buying a house when the prices are falling would give you a great chance for a better return in a  few years when the house prices rise once again meaning you could make a bigger profit when you sell.

In areas listed above, the house prices are falling significantly allowing you to find a great deal on your home in these locations.

As well as areas with falling prices, Move IQ has comprised a list of areas where house prices are the cheapest including Bradford (BD1) being the lowest with an average house selling for £69,939 in 2023.

If you can match the costs of mortgage rates and afford the deposit then this year could be yours to take the first step onto the property ladder at a lower cost.

In the Spring Budget  Jeremy Hunt, the Chancellor Exchequer has been hinting that there could be tax cuts coming up.

 

What is income tax?

Income tax is the tax you have to pay on your annual earnings or, if you’re self-employed, any profit you make. Depending on how much you earn determines how much income tax you pay. So, the more you earn, the more money you are paying in tax.

Income Tax is used to pay for public services and is the main source of income for the Government. The NHS, railway systems, education and more is paid for using income tax.

You are placed in band based off of what you earn, decided by HMRC, who collects the tax and the higher you earn, the higher your band, the more you pay and so the amount is as fair as possible.

The band you are in decides your tax code and therefore how much you can earn tax-free before you begin paying taxes on your earnings so, you could earn up to £12,570 before being taxed if your tax code is 1257L.

 

Why would the government cut it?

The government wants to cut taxes to relieve financial burdens across the UK however it has been suggested that there may not be enough money to do this.

With the elections coming up this year, the government is eager to make decision which will increase their poll numbers. As the UK entered a recession, the conservatives are under pressure to alleviate the financial pressures on the public.

 

What this means for your money?

If Hunt decides to cut income taxes then there will be the question of, what will pay for the public sector such as, the NHS? This could be spending cuts or using alternative funds.

If income tax is cut this will mean you will keep more of what you earn and be better off financially.

A tax cut will mean a decrease of how much you pay and will not altogether abolish income tax, they have been hinting at a 1p cut which could be beneficial to many.

 

On March 6th the Spring budget will be announced and we will find out what plans the government have made.

 

ISA stands for Individual Savings Account and allows you to save whilst earning interest and is tax-free. You can save up to £20,000 in a tax year tax-free. Having an ISA helps people to save for things like a house deposit as this a great, money-efficient way to save large amounts.

Cash ISA

This is similar to your regular current accounts as you are paid interest on your balance in the account. This is a simple way to save tax-free in a secure account for your money.

Cash ISA’s have interest rates of 5% or more currently.

Those over 16 can set up a cash ISA.

Stocks and Shares ISA

You can save up to £20,000 tax-free each year and your money is invested into various stocks and shares. This could help your account grow however there is a chance the value can go down as well. You can either choose where you money is invested or the bank will randomly invest your money into different stocks.

Only once you are 18 can you set up a stock and shares ISA.

Lifetime ISA

These are used to help you pay for your first house or alternatively to save for retirement.

This can be in the form of a Cash ISA or a Stocks and Shares ISA where you can save up to £4000 a year tax-free. The government will then add a 25% bonus which has to be used to help you buy a house such as pay for a deposit or for a retirement fund only. If you use this account to pay for anything else then there will be a 25% penalty rather than a reward at the time of withdrawal.

Only those between 18-39 are eligible for a lifetime ISA.

Withdrawing from your ISA

Your ISA will have certain rules regarding when you can withdraw as this is an account specifically for saving.

If you have an instant access Cash ISA you will be able to withdraw money at any time without any changes to your tax-free balance as this account will be for short-term savings.

If you have a fixed rate Cash ISA this will lock the money for a certain length of time and usually the interest rate for these accounts will be higher.

Then, there is the flexible Cash ISA here you will be able to make a limited number of withdrawals without losing any benefits of the ISA.

For the Stocks and Shares ISA you will usually be able to withdraw money at any time as long as you have cash in the account. If you want to withdraw money and you have no cash then you will have to sell shares at the current market price meaning you be losing money.

Why should you have an ISA?

If you are saving for something in particular and can afford to have savings which are in effect untouchable then having an ISA will be very beneficial to you. The money in your ISA should be separate from your personal savings in order for your ISA to be saved for your first home or retirement fund and to reap all the benefits.

With an ISA you are saving more with less.

From the 3rd of March we can expect a 4.9% increase in the price of rail fares across the UK.

This has been capped by the Department for Transport (DfT) to try and keep the prices as fair as they can. The increase in ‘regulated’ rail fares is linked to the annual July retail prices index (RPI) measure of Inflation, which was 9% in 2023.

Millions of commuters will feel the hit of this price increase in their everyday life and with mass cancellations and delays some are calling this an insult to the public.

The Trades Union Congress (TUC) called the rise "excessive" given "widespread cancellations and delays" across the network and called for rail to be brought back into public ownership.

Privatisation of British Rail

The ownership and operation of the railways in Britain were passed from government control into private hands, this process began in 1994 and was completed in 1997.

Now, Railway companies and stations are owned by various private companies.

What are Regulated rail fares?

Any train tickets you buy which are regulated will be affected by the increase of 4.9%.

What are unregulated Rail Fares?

If you buy these tickets they will not be affected by the upcoming price increases.

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